{"id":19377,"date":"2016-04-01T10:59:54","date_gmt":"2016-04-01T15:59:54","guid":{"rendered":"http:\/\/olduvai.ca\/?p=19377"},"modified":"2016-04-01T11:00:16","modified_gmt":"2016-04-01T16:00:16","slug":"the-other-problem-with-debt-no-one-is-talking-about","status":"publish","type":"post","link":"https:\/\/olduvai.ca\/?p=19377","title":{"rendered":"The Other Problem with Debt No One is Talking About"},"content":{"rendered":"
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The Other Problem with Debt No One is Talking About\u00a0<\/a><\/h3>\n<\/div>\n
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Faux Growth Recovery<\/strong><\/p>\n

Nearly 7 years have elapsed since the official end of the Great Recession.\u00a0 By now it\u2019s painfully obvious the rising tide of economic recovery has failed to lift all boats.\u00a0 In fact, many boats bottomed out on the rocks in early 2009 and have been taking on water ever since.<\/p>\n

Last week, for instance, it was reported that U.S. credit card debt\u00a0topped $917 billion in the fourth quarter of 2015<\/a>.\u00a0 That\u2019s up $71 billion from the year before.\u00a0 Shouldn\u2019t the economic recovery allow consumers to pay down their debts?<\/p>\n

\"Debt<\/a>Annual increase in credit card debt load\u2026.via cardhub (more data here<\/a>) \u2013 click to enlarge.<\/p>\n

 <\/p>\n

Indeed, it should, if only the economic recovery was the result of real, economic growth.\u00a0 To the contrary, the recovery has been faux growth driven by cheap Fed credit and financial engineering.\u00a0 Mutual increases in prosperity haven\u2019t occurred.<\/p>\n

In particular, those outside the financial services business, and other bubble industries, like government lobbyists, have largely missed out on any increase in income or living standard.\u00a0 Good paying professional jobs that vaporized during the downturn have been replaced with low paying service jobs.\u00a0 Consumers have used credit card debt to pick up the slack.<\/p>\n

Unfortunately, this short term solution sets up consumers for pain in the future.\u00a0 At some point, as debt increases faster than incomes, the ability to pay down the principal becomes near impossible.\u00a0 Even making the minimum payment becomes more and more difficult as new debt is added to the burden each month.<\/p>\n

Playing with Fire<\/strong><\/p>\n

\u201cWe\u2019re playing with fire now,\u201d\u00a0said Odysseas Papadimitriou<\/a>, chief executive of credit statistics and analysis site CardHub.\u00a0 \u201cEither an unexpected economic downtown or the continuation of current spending and payment trends could be enough to unleash an avalanche of defaults.\u201d<\/p>\n

…click on the above link to read the rest of the article…<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

The Other Problem with Debt No One is Talking About\u00a0 Faux Growth Recovery Nearly 7 years have elapsed since the official end of the Great Recession.\u00a0 By now it\u2019s painfully obvious the rising tide of economic recovery has failed to lift all boats.\u00a0 In fact, many boats bottomed out on the rocks in early 2009 […]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_monsterinsights_skip_tracking":false,"_monsterinsights_sitenote_active":false,"_monsterinsights_sitenote_note":"","_monsterinsights_sitenote_category":0,"footnotes":""},"categories":[2],"tags":[5728,10067,195,384,391,11763,670,827],"class_list":["post-19377","post","type-post","status-publish","format-standard","hentry","category-economics","tag-acting-man","tag-credit-card-debt","tag-debt","tag-great-recession","tag-growth","tag-mn-gordon","tag-recovery","tag-united-states"],"_links":{"self":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/19377","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=19377"}],"version-history":[{"count":2,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/19377\/revisions"}],"predecessor-version":[{"id":19379,"href":"https:\/\/olduvai.ca\/index.php?rest_route=\/wp\/v2\/posts\/19377\/revisions\/19379"}],"wp:attachment":[{"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=19377"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=19377"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/olduvai.ca\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=19377"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}